Equilar’s latest Compensation Insights newsletter includes a short article on how companies have gone about defining and analyzing the potential for excessive risk taking in their executive compensation programs. In light of the SEC’s recently proposed compensation disclosure rules, identifying excessive risk is an issue companies of all sizes are wrestling with. Below is an excerpt from our latest newsletter:

In addition to our article on defining excessive risk, the July 2009 Compensation Insights newsletter includes access to our latest report on CEO benefits and perquisites at Fortune 100 companies. It shouldn’t come as a surprise that a report on CEO perks is often one of our most widely read. A copy of the report can be requested here.

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Just last week the SEC released proposed rule changes that would increase proxy disclosure requirements around executive compensation and governance issues. If you’re one of those eager beavers who likes to sit in the front row or simply suffering from insomnia, click here to read the full SEC document.

These proposed rules include new disclosure requirements around:

• The relationship of a company’s overall compensation policies to risk;
• Inclusion of the grant-date fair value of equity awards made during the year;
• Expanded detail on the qualifications of directors, executive officers and nominees;
• Details of the company’s leadership structure and the board’s role in risk management; and
• Compensation consultants with potential conflicts of interest.

To see our additional analysis on these issues click here.

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The past few weeks have offered no shortage of groundbreaking news in our industry. Last week, we received word that Towers Perrin and Watson Wyatt would merge in a $3.2 billion deal. Later, the SEC voted unanimously to move forward with proposals for new compensation disclosure rules. And just yesterday, reports surfaced that the White House would soon "clamp down on potential conflicts of interest between compensation consultants and corporate executives." With the full extent of our economic slump now well understood, it is clear that we are entering a new phase: one of overhauls to the regulatory system and further rethinking of the role for compensation consultants.

With so much industry-shaking news swirling about, we set out to provide some clarity on the state of the executive compensation consulting landscape and the new SEC rules in the July 2009 edition of our Executive Compensation Trends newsletter. It was quite interesting to see the changes in market share for the leading consulting firms in 2008. Needless to say, if the proposed legislation is ultimately passed, we should expect even greater changes on the horizon. To learn more about these issues, and to read our article on financial planning perquisites for Fortune 100 CEOs, click here.

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